Student Loans – CEC UGC http://cec-ugc.org/ Tue, 22 Nov 2022 04:24:45 +0000 en-US hourly 1 https://wordpress.org/?v=5.9.3 https://cec-ugc.org/wp-content/uploads/2021/05/default-150x150.png Student Loans – CEC UGC http://cec-ugc.org/ 32 32 Can parents apply for student loan forgiveness? https://cec-ugc.org/can-parents-apply-for-student-loan-forgiveness/ Tue, 22 Nov 2022 00:34:10 +0000 https://cec-ugc.org/can-parents-apply-for-student-loan-forgiveness/ The student loan forgiveness proposal forwarded by President Biden offers up to $20,000 in debt relief to borrowers. Although this is usually the student who received the loan, parents who have taken out a Parent PLUS loan to pay for their child’s college education are also eligible for assistance. About 3.7 million families are thought […]]]>

The student loan forgiveness proposal forwarded by President Biden offers up to $20,000 in debt relief to borrowers. Although this is usually the student who received the loan, parents who have taken out a Parent PLUS loan to pay for their child’s college education are also eligible for assistance.

About 3.7 million families are thought to have outstanding Parent PLUS loans, totaling about $104 billion according to the Century Foundation.

Parents with an outstanding Parent PLUS loan from the federal government and household incomes below $250,000 ($125,000 for a single parent) will be able to claim up to $10,000 in debt forgiveness. There is another $10,000 relief for parents whose child has received a Pell Grant.

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When will student loan forgiveness be introduced?

However, at this time, neither parents nor students will be able to apply for student loan forgiveness after the White House temporarily closed the application process. It comes as a federal appeals court in St. Louis issued a temporary ban on the program after it claimed Biden exceeded his executive authority to approve the measure.

The White House is convinced that the program will come into action once the legal obstacles are removed. However, the delay will probably be longer than initially expected.

This week, the Department of Education began sending a letter to borrowers who have applied for student loan forgiveness.

CNBC reports that the letters, sent by Education Secretary Miguel A. Cardona, read: “We have reviewed your application and determined that you are eligible for loan relief under the plan.”

However, the memo goes on to say, “Unfortunately, a number of lawsuits have been filed challenging the program, that have blocked our ability to pay your debt at this time.

This would be a major problem for borrowers as December 31 approaches, the last day of the student loan repayment moratorium. Unless another extension is agreed, payments will have to resume in January and interest will start accruing again on the outstanding balance.

Biden will be desperate for a resolution in the coming weeks to provide peace of mind for student borrowers.

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If student debt relief passes, will loan forgiveness wipe out your tax refund? https://cec-ugc.org/if-student-debt-relief-passes-will-loan-forgiveness-wipe-out-your-tax-refund/ Sat, 19 Nov 2022 15:00:15 +0000 https://cec-ugc.org/if-student-debt-relief-passes-will-loan-forgiveness-wipe-out-your-tax-refund/ This story is part Taxes 2022CNET’s coverage of the best tax software and everything you need to file your return quickly, accurately and on time. Currently widespread remission of federal student loans remains on hold, awaiting a decision from a federal appeals court. But if debt relief materializes, will you end up with a tax […]]]>

This story is part Taxes 2022CNET’s coverage of the best tax software and everything you need to file your return quickly, accurately and on time.

Currently widespread remission of federal student loans remains on hold, awaiting a decision from a federal appeals court. But if debt relief materializes, will you end up with a tax bill in 2023?

Although you don’t owe federal tax on any canceled student debt through 2025, thanks to a provision inserted into the $1.9 trillion from the American Rescue Act’s COVID relief programyou could end up owing state and county taxes.

Whether you receive a rebate under the federal student loan forgiveness plan, Cancellation of civil service loans or another program, your tax liability is the same. Here’s everything you need to know about how your student loans affect your tax bill. We’ll also share some tax deductions to help you lower your tax bill or increase your refund next year.

How are canceled student loans taxed?

Although federal taxes on canceled student debt are temporarily suspended until 2025, generally canceled school loan balances are taxed as income. This means that if you receive student loan forgiveness, this amount will be added to your adjusted gross income (the amount you earned last year less any eligible tax deductions). So if you earn $50,000 a year and qualify for $20,000 in debt relief, your income will be adjusted to $70,000 for the year.

States and counties also tax canceled student debt as income.

These States Currently Tax Canceled Student Debt

Most states will not impose taxes on forgiven student loan balances, but a handful will. Right now, we know that Indiana, Minnesota, Mississippi, and North Carolina are all planning to make student loans tax-free.

And two other states, Arkansas and Wisconsin, may follow suit, but have yet to confirm their tax plans.

How much will state and county taxes cost you?

If you live in a state that will impose student loan tax forgiveness, the amount you will owe will depend on your state and local tax rate. Some states have flat tax rates, while others have graduated tax rates, where you pay a higher rate if you’re in a higher tax bracket.

Both Indiana and North Carolina have flat tax rates (3.23% and 4.99%, respectively). Mississippi has a progressive income tax rate, ranging from 3% to 5%, and Minnesota’s progressive tax rate ranges from 5.35% to 9.85%.

If you get student loan forgiveness in Indiana, for example, you can expect to pay $323 in state taxes for $10,000 in debt relief and $646 in state taxes. for $20,000 back.

County taxes may also apply in some states and may be flat or graduated. For example, in Indiana, residents of the capital Indianapolis pay 2.02% Marion County income tax. That means borrowers who receive $10,000 in forgiveness will owe an additional $202 in local income tax, and those who receive $20,000 in debt relief will owe an additional $404. In total, that means a borrower in Indiana could owe up to $1,050 in state and county taxes on canceled student loans.

These states do not tax canceled school loans

According to Mark Kantrowitz of The College Investor, 28 states, plus Washington DC, either have no income tax (and therefore would not tax canceled student loan debt) or automatically comply with federal law and do not will not tax this canceled debt. These include:

  • Alaska
  • Connecticut
  • Delaware
  • Florida
  • Illinois
  • Iowa
  • Kansas
  • Louisiana
  • Maryland
  • Massachusetts
  • Michigan
  • Missouri
  • Montana
  • Nebraska
  • Nevada
  • New Hampshire
  • New Mexico
  • New York
  • Ohio
  • Oklahoma
  • Rhode Island
  • South Dakota
  • Tennessee
  • Texas
  • Utah
  • Vermont
  • Washington
  • washington d.c.
  • Wyoming

Other states that do not automatically comply with the federal provision, such as Hawaii, recently announced that canceled student loan debt would not be taxed at the state level. Spokespeople from Virginia, Idaho, New York, West Virginia, Pennsylvania and Kentucky also told The Associated Press that their states will not tax borrowers on canceled student debt.

Although California could technically tax canceled student debt, lawmakers said residents would not be taxed on canceled student loans. California State Assembly Speaker Anthony Rendon confirmed in a tweet that the state is ready to take action to stop Californians from paying taxes on canceled debt — and will once details of the federal student loan forgiveness program will be finalized.

At this time, it is unknown what will happen in the states not mentioned, but we will keep you updated as the situation develops.

Other tax considerations for those with student loans

In addition to student loan forgiveness optionsyou may be eligible for tax credits and deductions. Although the 2023 tax thresholds have yet to be released, here are some student loan tax breaks that could increase reimbursement next year or reduce your tax bill.

Student loan interest deduction

When you make monthly payments on your student loans, this includes your principal payment plus any accrued interest payments. Whether you have private or federal student loans, the student loan interest deduction allows you to reduce your taxable income, depending on the amount of interest you paid. For 2021, this reduction has increased to $2,500 per year.

You are eligible for the deduction if you paid interest on a student loan in the particular tax year and you meet the modified adjusted gross income requirements (your income after taxes and allowable deductions). For 2021, you qualify if your MAGI was less than $70,000 (or $100,000 if you are married and filing a joint application). Partial deductions were offered for those with MAGI between $70,000 and $85,000 ($100,000 – $170,000 for those who filed jointly).

With federal student loan payments on pause and interest at 0%, you may not have paid any interest in the past year. That said, you must log into your student loan portal and verify Form 1098-E for any qualifying interest payments.

If eligible, this deduction will reduce your taxable income, which could reduce the amount you owe the IRS or increase your tax refund. You could even be placed in a lower tax bracket, which could entitle you to other deductions and credits
.

US Opportunity Tax Credit

The American Opportunity Tax Credit is available to new students during their first four years of graduate school. It allows you to claim 100% of the first $2,000 of eligible educational expenses, then 25% on the next $2,000 spent, for a total of up to $2,500. If you are a parent, you can claim the AOTC per eligible student in your household, provided they are listed as a dependent.

To claim the full credit in 2021, your MAGI must have been $80,000 or less ($160,000 or less for married people filing jointly). If your MAGI was between $80,000 and $90,000 ($160,000 to $180,000 for those filing jointly), you may be eligible for a partial credit.

The AOTC is a refundable credit, which means that if it reduces your income tax to less than zero, you may be able to get a refund of your taxes or increase your existing tax refund.

Lifetime learning credit

You can recover money for eligible education expenses through the Lifetime Learning Credit. The LLC can help pay for any level of continuing education courses (undergraduate, graduate, and professional degrees). Transportation to college and living expenses are not considered eligible expenses for the LLC.

Unlike the AOTC, there is no limit to the number of years you can claim the credit. You could get up to $2,000 each year or 20% on the first $10,000 of eligible education expenses. However, the LLC is non-refundable, meaning you can use the credit to reduce your tax bill if you have one, but you won’t get any credit back as a refund.

For 2021, you were eligible for this credit if you had qualifying expenses and your MAGI was less than $59,000 ($118,000 for married people filing jointly). You could also claim a reduced credit if your MAGI was between $59,000 and $69,000 ($118,000 and $138,000 for married people filing jointly).

To note: You cannot apply for both AOTC and LLC for the same student in the same tax year. If you qualify for both, the AOTC generally provides greater tax relief (and may increase your refund).

If your loans are in default, will next year’s tax return be seized?

Normally, if you have federal student loans in default (meaning you are unable to pay what you owe for 270 days), your tax refunds can be used to cover the balance owing. Since federal student loans were on pause during the 2022 tax season, your federal tax refund was not eligible for government garnishment.

It’s unclear if this will remain in place for 2023, but with the new payment pause set to expire at the end of 2022, this benefit may expire.

Your tax filing status may affect your student loan payments

If you repay federal student loans and follow an income-based repayment plan, your marital status may affect your payment amount. For example, if you are married and filing jointly, your payments are based on the joint income between you and your spouse. If you are married and file separately, your payments are based on your income only.

However, if you decide to file separately to lower your monthly IDR plan payment, you may miss out on other key tax benefits. For example, you may not be able to take advantage of a lower tax rate given to married couples who file jointly, nor will you be able to claim increased credit and deduction amounts available if you file jointly.

The revised Pay As You Earn, or REPAYE, plan does not distinguish between whether you are listed as married filing separately or married filing jointly. Your payments are based on your income and that of your spouse.

More advice on student loans

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What to do if you have already applied https://cec-ugc.org/what-to-do-if-you-have-already-applied/ Wed, 16 Nov 2022 18:00:33 +0000 https://cec-ugc.org/what-to-do-if-you-have-already-applied/ iStock.com Although borrowers have until December 31, 2023 to apply for student loan forgiveness, many are not waiting to begin the application process. Applying now, borrowers who have received Federal Pell Grants and meet income requirements can receive up to $20,000 in debt relief from the US Department of Education. Student Loan Repayment: Mark These […]]]>

iStock.com

Although borrowers have until December 31, 2023 to apply for student loan forgiveness, many are not waiting to begin the application process. Applying now, borrowers who have received Federal Pell Grants and meet income requirements can receive up to $20,000 in debt relief from the US Department of Education.

Student Loan Repayment: Mark These 4 Dates on Your Calendar Now
Discover: 9 bills you should never put on automatic payment

The question every borrower faces is, what happens after you apply for student loan forgiveness? Should they do anything else while they wait?

If you applied, here are the next steps the federal student aid office is taking.

Your application is reviewed

When you submit a request for student loan debt relief, you will receive an email confirmation. Keep in mind that you will not be able to view the status of your application through your StudentAid.gov account.

Once the application is submitted, it will be reviewed to confirm that you are eligible for debt relief.

Take our survey: Do you think student loan debt should be forgiven?

You can be contacted for more information

The federal student aid office can contact you if they need more information. There are several reasons why you may be contacted, including:

  • Documentation is needed to verify your income

  • More information is needed about your parents’ income (this applies to borrowers who were enrolled as dependent students between July 1, 2021 and June 30, 2022)

  • The information you provided in the application does not match Department of Education loan records

  • The ED determines that you have no eligible federal loans.

Borrowers who respond will receive instructions by email. Those who don’t hear back don’t need to take action for more information.

You will be notified once your request has been approved

After confirmation of eligibility, the federal student aid office will notify you and inform you of how debt relief is applied. This information will be provided to your loan manager.

Debt relief is applied to your loans

If you have been approved for debt relief, it will be applied directly to your account by your loan servicer. It’s important to be patient, as updating your account and taking into account debt relief adjustments can take some time.

Your loan manager will also let you know if your loans are now paid in full or if you have an outstanding balance. If you have a balance left, you will be notified by your loan officer of your new monthly payment once payments resume after December 31, 2022.

Debt cancellation is on hold: do you need to reapply?

Currently, debt forgiveness is on hold. The Ministry of Education, following a court order, is temporarily prevented from processing debt discharges. The federal student aid office will continue to review applications and encourage eligible borrowers to apply.

Borrowers do not need to reapply. The federal student aid office said it would process the dumps quickly when it was able to do so.

More from GOBankingRates

This article originally appeared on GOBankingRates.com: Student Loan Forgiveness: What to do if you’ve already applied

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Student loans: Will Biden extend repayment pause as relief package stalls? https://cec-ugc.org/student-loans-will-biden-extend-repayment-pause-as-relief-package-stalls/ Mon, 14 Nov 2022 20:04:51 +0000 https://cec-ugc.org/student-loans-will-biden-extend-repayment-pause-as-relief-package-stalls/ Alex Brandon/AP/Shutterstock.com On Nov. 10, the Biden administration’s student loan forgiveness program received a major blow when Texas Federal Court Judge Mark Pittman blocked it from moving forward, declaring the program illegal. initiative to give loan holders up to $20,000 in relief money. See: Student loan repayment checks are in the mail for anyone who […]]]>

Alex Brandon/AP/Shutterstock.com

On Nov. 10, the Biden administration’s student loan forgiveness program received a major blow when Texas Federal Court Judge Mark Pittman blocked it from moving forward, declaring the program illegal. initiative to give loan holders up to $20,000 in relief money.

See: Student loan repayment checks are in the mail for anyone who paid during the COVID-19 moratorium
Student loans: Supreme Court rejects blocking Biden’s pardon plans, so why is he still on hiatus?

The decision, which also led the official StudentAid.gov website to withdraw the request, came just days before a first round of payments was supposed to go to millions of Americans – and before repayments of loans in January 2023, like GOBankingRates before. reported.

Will President Biden extend the student loan payment break?

Given the latest developments, many are wondering if President Biden will announce another break in refunds before the December 31 deadline, with media outlets (such as Forbes) saying “the odds have just increased.”

One of Biden’s goals for the student loan relief plan, first announced in August, was to permanently end the loan repayment moratoriums that have been repeatedly extended during the pandemic.

By providing nearly 45 million eligible borrowers with relief funds ($10,000 for most applicants, $20,000 for low-income Pell Grant recipients), the idea was to cancel a significant portion of unpaid debts, making monthly payments more affordable when they finally resume.

But with that funding now on hold, Biden may be forced to act and re-announce an extension of repayments, especially as pressure mounts from advocacy groups to do so.

Pressure grows to extend suspension of student loan payments

As Persis Yu of the Student Borrower Protection Center said in a recent statement, according to Forbes: “The Biden administration can no longer resume payments on January 1. It must use all of its tools to fight to ensure that borrowers receive the debt relief they need.

Natalia Abrams, president of the Student Debt Crisis Center, added, “The goal of the president’s debt cancellation plan is to help middle and working class Americans heal from the damage caused by the pandemic. We share this mission and will work diligently to ensure that every borrower has the resources they need to get back on their feet. It starts now, with an immediate extension of the federal student loan payment pause…President Biden must pause payments farther into the future to provide financial stability and peace of mind for 40 million Americans.

The White House press secretary intervenes

As news of Pittman’s decision broke late last week, White House press secretary Karine Jean-Pierre shared a statement with the media, saying President Biden would retaliate. decision and hoped to get the program back on track. “The president and this administration are committed to helping working and middle class America get back on their feet,” she said in part.

As the student debt relief program could take months to work through the courts, there is good reason to believe that Biden could impose another pause on loan repayments in the meantime, as the future of student loan relief is at stake.

Take our survey: Do you think student loan debt should be forgiven?
More: Newsom says California won’t tax Biden’s student loan forgiveness, saving borrowers another $1.3 billion

For now, the StudentAid.gov site has removed the loan relief application and replaced it with a message that reads, in part: “Therefore, at this time, we are not accepting applications . We seek to rescind these orders. The site also noted that the federal government would retain all previously submitted documents.

More from GOBankingRates

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How to know if you can https://cec-ugc.org/how-to-know-if-you-can/ Sat, 12 Nov 2022 00:02:03 +0000 https://cec-ugc.org/how-to-know-if-you-can/ Michel Tisserand Michel Tisserand Michael Weaver has long struggled under the weight of his student loan debt, which amounts to around a quarter of a million dollars. The addictions counselor, whom her mother describes as “compassionate,” couldn’t imagine a debt-free future, let alone be able to help her daughter achieve her college dreams. Everything changed […]]]>

Michael Weaver has long struggled under the weight of his student loan debt, which amounts to around a quarter of a million dollars.

The addictions counselor, whom her mother describes as “compassionate,” couldn’t imagine a debt-free future, let alone be able to help her daughter achieve her college dreams.

Everything changed when Weaver appeared on Go for Broke, a reality show that helps Americans overcome their financial burdens. In an episode that aired Nov. 11, host Tonya Rapley enlists student loan expert Bobby Matson, founder and CEO of Payitoff, to help Weaver manage his debts.

Matson explains that he started the business because he and his wife also faced six-figure debts that prevented them from starting a family.

After reviewing Weaver’s situation, Matson discovered that he was eligible for the Public Service Loan Forgiveness Program, which provides tax-free loan forgiveness on federal student loan debt for those who have worked as a public servant for ten years or more. Since Weaver was well past the eligibility point, he was able to have his entire $250,000 balance cleared.

“Now I’m going to be able to help my daughter get to college,” Weaver said after hearing the news. “That’s the best news besides his birth.”

Weaver is just one of millions of Americans who could be eligible for a student debt relief program. Today, about 44 million Americans owe a total of $1.75 trillion in student loans, but the recently announced student loan relief program will reduce much of that debt for most borrowers.

Under this program, the Department of Education provides $10,000 in debt relief to all borrowers and $20,000 to Pell Grant recipients who meet income requirements. Specifically, the program applies to those who earned less than $125,000 as an individual or less than $250,000 as a household for married couples in 2020 or 2021. However, the relief comes with also a resumption of payments, which will begin in January. after a pandemic pause of several years.

Here are some steps borrowers can take to regain control of their student loans before payments resume.

1. Apply for the Federal Student Loan Debt Relief Program as soon as possible.

To have your loans discharged before payments resume, you must apply now. It doesn’t matter if you’re actively repaying your loans, in school, in grace period, or in default, as long as you have eligible federal student loans and meet certain income requirements. You can read more about these eligibility requirements and complete the debt relief application on the FSA website (debt relief application is open, but debt relief has been suspended) . You can also check your eligibility for free through Payitoff’s Debt Relief Eligibility Tool.

2. Know who your student loan managers are.

Your student loan manager handles billing and other services on federal student loans on behalf of the federal government, and is often able to provide borrowers with repayment options they may not know are available. . For example, some lending services offer income-based repayment plans and loan consolidation, which can help make outstanding debt more manageable. They can also help recover usernames and reset passwords for those who lost track of their credentials during the long payment break. Those with multiple loans may even have more than one. To find your service agent, visit your Federal Student Aid (FSA) account dashboard and scroll down to the “My Loan Officers” section.

3. Review and update contact information and payment preferences

In order to help you stay on top of your student loans, your service needs up-to-date contact information, and given the time since the last payment, many Americans need an update. Make sure your loan officer has your correct address, phone number, and email address, and don’t forget to review your payment preferences, especially your autopay settings, before returning payments in January. If you haven’t used autopay before, it might be time to consider signing up, because signing up for autopay for federal loans can help you save.

4. Explore options to lower your monthly payments now.

To lower your monthly federal student loan payments, consider applying for an income-contingent repayment plan. These programs are designed to ensure that your monthly payments remain affordable based on your income and family size. To reduce private student loan monthly payments, consider refinancing with a private lender.

If, like Weaver, you’re not sure where to start or need help, you can also access Payitoff’s personalized, automated advice to find the best steps for your student loans for free; Don’t expect the CEO to deliver your solution to you in person.

Text “JOIN” to +1 (323) 591-5880 or click this link to receive free advice on managing your student loan debt.

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Biden’s student loan cancellation is in jeopardy. It may have helped stop a ‘red tsunami’ as Gen Z flocked to the polls to save their relief. https://cec-ugc.org/bidens-student-loan-cancellation-is-in-jeopardy-it-may-have-helped-stop-a-red-tsunami-as-gen-z-flocked-to-the-polls-to-save-their-relief/ Wed, 09 Nov 2022 18:41:57 +0000 https://cec-ugc.org/bidens-student-loan-cancellation-is-in-jeopardy-it-may-have-helped-stop-a-red-tsunami-as-gen-z-flocked-to-the-polls-to-save-their-relief/ George Washington University student Kai Nilsen and other student debt activists rally outside the White House a day after President Biden announced a plan that would forgive $10,000 in student loan debt for those who earn less than $125,000 a year in Washington, DC on August 25. 2022.Photo by Craig Hudson for The Washington Post […]]]>

George Washington University student Kai Nilsen and other student debt activists rally outside the White House a day after President Biden announced a plan that would forgive $10,000 in student loan debt for those who earn less than $125,000 a year in Washington, DC on August 25. 2022.Photo by Craig Hudson for The Washington Post via Getty Images

  • The “red tsunami” Republicans were hoping for did not come in the midterm elections.

  • Advocates and lawmakers credit youth voter turnout with helping Democrats win.

  • Canceling student loans was a major policy that enjoyed the support of the majority of young voters.

If President Joe Biden hadn’t signed into law a broad student loan forgiveness, Republicans might have gotten the election victories they were hoping for.

Gen Z may have helped.

Prior to the midterm elections, polls predicted massive GOP victories across the board, allowing them to regain significant control of the House and Senate. But as the results continue to pour in, it has become clear that the red wave has turned into a ripple, with control of both houses of Congress too close to call the day after the election.

Although it is difficult to determine exactly what may have caused this change, the opinions of young voters must be taken into consideration. According to Edison Research’s National Election Pool Exit Poll, 63% of voters ages 18-29 backed Democrats, and 89% of young blacks and 68% of young Latinos voted for a Democratic House candidate. . With the oldest Gen Zers turning 25 this year, this group includes the youngest Millennials and Zoomers of voting age.

“The role of young people in this election cannot be underestimated. Turnout in many of these races,” New York Rep. Alexandria Ocasio-Cortez wrote on Twitter.

“By 2024, millennial and Gen Z voters will outnumber baby boomer and older voters, 45/25,” she added. “We’re starting to see the political impacts of this generational shift.”

Major issues such as reproductive rights, climate change, and student loan forgiveness likely contributed to this turnout. John Della Volpe, director of polls at the Harvard Kennedy School Institute of Politics, wrote on Twitter that “if not for voters under 30…tonight would have been a red wave,” and he referenced Biden’s policies on climate and student debt that he says helped Democrats win votes.

Student loan forgiveness is currently on hold due to a ruling by the 8th Circuit Court of Appeals, in response to a lawsuit filed by six Republican-led states seeking to end debt relief . But Biden’s August announcement of up to $20,000 in relief for federal borrowers earning less than $125,000 a year was a long-awaited policy the president pledged to follow during the campaign trail. , and which has always been well received by young voters. A Morning Consult poll last year, for example, found that millennial voters are the most likely to support student debt cancellation among all Americans.

Biden has frequently touted the relief leading up to the midterm elections, and he has criticized Republicans trying to prevent debt cancellation from affecting the accounts of the 26 million borrowers who have already applied. But White House Chief of Staff Ron Klain said on Twitter that even amid these challenges, Biden addressing progressive priorities has helped motivate young voters now and could set a precedent for the future.

“The @POTUS delivered on its promises to young Americans (climate change action, student loans, marijuana reform, etc.), and they responded with energy and enthusiasm,” Klain said. wrote on Twitter.

“The youth agenda takes center stage in the Democratic Party”

Support for student loan forgiveness is higher among younger voters than the general public. A Wall Street Journal poll last week found that while 48% of the public supported Biden’s debt relief plan, 59% of voters ages 18 to 34 supported the plan, and exit polls from CNN revealed that about half of voters also supported the plan.

For months before the midterm elections, some Democratic lawmakers stressed the importance of the youth vote. Massachusetts Sen. Elizabeth Warren, for example, said in January — six months before Biden even announced broad debt forgiveness — that “the cancellation of student loan debt for more than 40 million Americans would persuade a lot of young people that this president is in the fight for them.”

Cristina Tzintzún Ramirez, president of NextGen America — a progressive group that mobilizes young voters — told Insider that in addition to social issues like abortion, “there are a lot of young people who have also been found to be really protecting gains. economic justice, issues like student debt relief and trying to keep extending and raising the minimum wage and protecting union rights.”

“The youth agenda takes center stage in the Democratic Party,” she said. “The red wave or the red tsunami that was going to happen didn’t materialize and that’s because the young people came.”

Read the original article on Business Insider

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Student Borrowers Should Do These 7 Things Before January https://cec-ugc.org/student-borrowers-should-do-these-7-things-before-january/ Fri, 04 Nov 2022 19:03:15 +0000 https://cec-ugc.org/student-borrowers-should-do-these-7-things-before-january/ President Joe Biden speaks about student loan forgiveness at Delaware State University, Friday, October 19. … [+] February 21, 2022 in Dover, Del. (AP Photo/Evan Vucci) Copyright 2022 The Associated Press. All rights reserved Millions of borrowers are eligible for recently announced student loan forgiveness initiatives. But at the same time, many of those borrowers […]]]>

Millions of borrowers are eligible for recently announced student loan forgiveness initiatives. But at the same time, many of those borrowers who won’t have their loans fully forgiven will resume paying off their remaining balances within weeks.

After nearly three years and several extensions, the ongoing Covid-related student loan pause is set to end on December 31, and there is no indication that it will be extended again.

“We’re relieving student debt, but we’re also resuming student loan repayments that were put on hold during the pandemic,” President Biden said in public comments this week. “In January, people whose debt is not fully forgiven … will start paying off their student loans again.”

Student borrowers should start taking steps now to maximize their loan forgiveness opportunities and prepare for repayment. Here’s what you can do.

Review Student Loan Forgiveness Programs

The Biden administration has rolled out several new student loan forgiveness programs in recent months, and there are still opportunities to apply. Borrowers should take the time to assess their potential eligibility and determine what steps, if any, are necessary to receive the benefits. Here are some of the most important student loan forgiveness initiatives currently available:

Find out if your student loan officer has changed

While most federal student loans have been on hiatus since March 2020, a lot has changed within the federal student loan system. Several loan managers left the Department of Education’s federal student aid system and new loan managers stepped in. Somewhere between 10 and 20 million borrowers have experienced loan service changes since the start of the payment pause – and many may not even realize it.

Some of the biggest changes involve Navient transferring its entire government-held federal student loan portfolio to Aidvantage. And MOHELA took over the Public Service Loan Forgiveness Program (PSLF) from FedLoan Servicing. Other accounts that previously belonged to FedLoan Servicing have been transferred to other loan servicers, such as EdFinancial.

Borrowers should verify their current Federal Student Loan Service details by logging into their Department of Education account on StudentAid.gov. If you have a new loan manager, also be sure to create an online account with that new loan manager for the most up-to-date loan details and communications regarding your student loans.

Update your contact information with your student loan officer

A lot has changed for many student borrowers since March 2020. You may have moved or gotten a new phone number or email address. As repayment is about to resume, now is a critical time to ensure your contact information is up to date with the Department of Education and your student loan officer. The lack of significant correspondence regarding student loan repayment or cancellation opportunities could cause significant problems.

Take advantage of the fresh start to get your student loans in default

For borrowers with federal student loans in default, the Department of Education is offering a unique opportunity called the Fresh Start initiative that will allow many borrowers to emerge from default and restore their loans to good standing. Getting out of default is important not only to avoid detrimental outcomes like continued negative credit reports or wage garnishment, but it may also be necessary to qualify for certain student loan forgiveness programs.

Fresh Start isn’t available yet, but it should be by January. You can learn more here.

Certify your employment for Public Service Loan Exemption (PSLF)

Borrowers applying for Public Service Loan Forgiveness (PSLF) — a student loan forgiveness program for borrowers working for nonprofits or government organizations — may only receive credit for “qualifying payments” only if submit PSLF employment certification forms. Borrowers must periodically resubmit a new certification form signed by their employer to obtain an updated PSLF-eligible payment tally.

Although the limited PSLF waiver ended on October 31, borrowers can still receive retroactive credit for the PSLF, and in fact can only do so by continuing to periodically resubmit PSLF employment certifications. If you haven’t certified your PSLF job in a while, now is a good time to do so. You can start the process using the Department of Education’s PSLF Support Tool.

Borrowers on income-contingent repayment (IDR) plans should prepare for repayment

Borrowers who were on an income-based repayment (IDR) plan when the payment pause began in March 2020 should return to the plan they were in, at the payment amount they were paying before, when payments resume in January (provided they have not applied to switch plans or recalculate their IDR payments). Borrowers will not have to recertify their income for their IDR plan until 2023.

Borrowers who were on an IDR plan but have experienced a change in financial circumstances since 2020, such as loss of work or reduction in income, may consider requesting a recalculation of their IDR payments before January. Borrowers have the right to request a recalculation of their IDR payments at any time based on changing circumstances. You can start the process here.

Assess student loan repayment plan options

For all student borrowers, now would be a good time to evaluate your repayment plan options. Borrowers can get monthly payment estimates under all available repayment plans using the Ministry of Education’s repayment simulator.

Borrowers who cannot afford their monthly payments under a standard, extended, or graduated plan may consider an IDR plan instead. The Education Department is also developing a new IDR plan, and details about it could be released before January.

Further Reading on Student Loans

Court block on student loan forgiveness continues, but there’s a big update

When will you receive student loan forgiveness? Key schedule details

A new, bigger student loan forgiveness initiative is about to be launched – and it’s not what you think

In Reversal, Biden Administration Announces New Student Loan Forgiveness Eligibility Limits

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Don’t cry for lenders in student loan fiasco https://cec-ugc.org/dont-cry-for-lenders-in-student-loan-fiasco/ Wed, 02 Nov 2022 12:17:13 +0000 https://cec-ugc.org/dont-cry-for-lenders-in-student-loan-fiasco/ Judge Amy Coney Barrett, President Trump’s latest Supreme Court nominee, recently dismissed a motion, without comment, from a conservative group in Wisconsin called the Brown County Taxpayers Association, which asked the court to block the tax plan. Biden administration aimed at canceling student loans. Shortly thereafter, a federal judge in Missouri launched a lawsuit brought […]]]>

Judge Amy Coney Barrett, President Trump’s latest Supreme Court nominee, recently dismissed a motion, without comment, from a conservative group in Wisconsin called the Brown County Taxpayers Association, which asked the court to block the tax plan. Biden administration aimed at canceling student loans.

Shortly thereafter, a federal judge in Missouri launched a lawsuit brought by six Republican states seeking similar relief by telling the states that they had shown no harm that might result and therefore had no standing. to act.

But then a federal appeals court issued a temporary stay on youhe debt relief.

Based on the flurry of lawsuits they’ve filed recently, the party that has spent the last 30 years denigrating litigators often seems to be aiming for full employment of litigators lately.

Quackers who think “Let’s Go Brandon” is the height of political satire are apparently upset that a lazy English major living in mum’s basement, with purple hair, piercings and a part-time job in a café, will have his student debt paid with “my taxes”.

This is a gross misrepresentation of the student debt situation.

Federal student loans are used by students regardless of field of study. They are also used by trade school students. You know, plumbers, electricians, linemen, carpenters and even computer programmers.

Your hairstylist, dental technician or medical assistant might have used student loans to pay for their training. Many entry-level truck drivers were trained in trade school using a federal student loan.

The ease of obtaining a federal student loan is its biggest selling point. A borrower does not need to have a credit history, co-signer, or income. Interest rates are generally lower than private loans, have fixed rates and more flexible repayment terms.

So who else has benefited from student loans?

Lenders – banks and various scammers. The so-called school counselors. And the education and training institutions themselves have done extremely well with federal student loans. It’s hard to imagine a public university able to pay its athletic trainers seven figures without federal money from student loans.

Undoubtedly, the cancellation of loan contracts raises serious moral hazard questions about money lenders and their customers (victims.) Moral hazard is the term used by economists to describe a situation in which people will take too much risk because they believe that in the end they will not have to bear all the consequences. As if they had insurance – or the government to bail them out.

Namely: Lenders have been given a sweet spot in the student loan business, which has encouraged them to make bad loans, knowing they will eventually be repaired.

But these are the kind of questions that should have been asked years agonot when Biden decided to helpeast of one-third of Minnesota’s population with zero student loans.

The ancestor of all moral hazard situations was the 2008 financial crisis and the subsequent bank bailouts. Mortgage lenders and their Wall Street partners acted like drunken pirates in a casino, and there were hardly any consequences – for them anyway.

The moral preening of charlatans is also highly selective: where were they a few years ago when the federal government handed out billions of taxpayer dollars in Paycheck Protection Program (PPP) loans to businesses, organizations at non-profits and even churches? This money was intended to cover salary expenses and, if used as intended, the loan was cancelled. Most loans have been forgiven, many in the six- and seven-figure range. In other words, people – and businesses are people, right? — borrowed money, that is, taxpayers’ money, knowing that they would not repay it. It’s a moral hazard for someone to quack.

Financial consultants and banks – many of whom are involved in selling student loans – have taken advantage of the PPP windfall, collecting hefty fees for loan preparation and processing.

Where were the charlatans when we gave the big banks a giant giveaway by exempting credit card companies from state usury laws, those pesky restrictions on the interest rates a lender could legally charge consumers? Minnesota attrition is capped at 8%. The average credit card interest today is over 16%, a rate available to a relative handful of cardholders. Most credit cards charge 20% or more. They are not subject to state laws.

During the Watergate era, the phrase “follow the money” became popular. And that seems applicable here. If you’re more worried about the purple-haired English Literature major seeing $10,000 in student loans forgiven than the industry that can’t lose in the student loan business, follow the money.

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30-year-old with $110,000 student debt wanted PSLF; The balance keeps growing https://cec-ugc.org/30-year-old-with-110000-student-debt-wanted-pslf-the-balance-keeps-growing/ Sun, 30 Oct 2022 12:30:41 +0000 https://cec-ugc.org/30-year-old-with-110000-student-debt-wanted-pslf-the-balance-keeps-growing/ Kjerstin Laine, 30, owes more than $110,000 in student debt to undergraduate and graduate programs. Laine’s career in the nonprofit sector, in theory, offers a path to forgiveness. But the interest means she barely paid it, and Biden’s pardon is just a drop in the bucket. Loading Something is loading. Thank you for your registration! […]]]>
  • Kjerstin Laine, 30, owes more than $110,000 in student debt to undergraduate and graduate programs.
  • Laine’s career in the nonprofit sector, in theory, offers a path to forgiveness.
  • But the interest means she barely paid it, and Biden’s pardon is just a drop in the bucket.

Like millions of student borrowers, Kjerstin Laine is in loan relief limbo.

For Laine, a 30-year-old woman who has more than $110,000 in student debt, the $20,000 forgiveness she’s about to get from President Joe Biden’s plan is just a straw of water in the ocean. As a first-generation college student whose debt has shaped the trajectory of her career, she fears her balance will swell even further after pandemic-era payment pauses end and interest will start to rise again. accumulate.

“I never miss a payment, always on time, and yet my balances never go down,” Laine told Insider. “I don’t understand how people can’t see that there is something wrong with this photo.”

Although she worked in college and took steps to cut costs, Laine graduated in 2014 with a total debt of $98,000 from her undergraduate and graduate studies. Over the next eight years, accrued interest brought his balance down to what it is today, despite his constant repayment.

Laine chose her job in communications for an education advocacy nonprofit because it was a good fit with her skill set — and because it could set her up for public service loan forgiveness, which cancels student debt for government and nonprofit workers after 10 years of qualifying payments.

But that program has always been riddled with flaws, and she recently interrupted that strategy to take a job at a marketing agency with a salary that brings her much closer to the $90,000 the federal government estimated she should be earning. a year to pay it back. debt. It also pays off medical debt.

“I also had to leave the nonprofit sector to get close to it, obviously,” she said. “So that’s how it is Catch-22.”

Laine is one of many millions of American borrowers stuck in an untenable situation. She’s grateful for the relief she’s about to get — though the legality of Biden’s pardon is still under scrutiny — but isn’t sure she’ll be able to afford the monthly payments when they come up. will restart in January.

His situation highlights the larger structural issues underlying the student debt crisis, where first-generation, low-income students take on huge debts to advance and increase their incomes, but still find themselves buried under ever-increasing sales. Many, like Laine, have shaped their lives around the hope of help – now that it’s there in one form or another, it may not be enough.

“The hard part is that I trusted this system that I was told from a young age was going to be my path to prosperity or a decent life – nothing exorbitant – but a decent middle class life where I could give back to the community that helped raise me and supported me through education programs, meal programs, etc.” Laine said. “And it looks like that’s a big broken promise now.”

Interest on student loans can balloon, which means balances aren’t going down — and could be going up

As a college student in California, Laine worked multiple jobs at places like restaurants and grocery stores. She took classes at her local community college and university in the summer and winter to try to keep her expenses down. She graduated in 2012, a semester early to cut costs, racking up nearly $18,000 in total debt for her undergraduate degree in journalism.

She went to a “dream school” for a master’s degree in journalism, still working part-time and coming away with an additional $80,000 in debt in 2014. Upon graduation, she was hospitalized with dehydration after saying that she had run. tattered.

Despite steady payments, the years since graduation have seen Laine’s debt mount. It boils down to the issue of capitalization of interest, which is when accrued interest adds to a borrower’s principal balance and can lead to much more indebtedness than was originally borrowed.

The Biden administration has taken steps to prevent capitalization of interest. In July, it released a proposal to end the practice in all cases not required under the Higher Education Act, such as abstention periods, but those changes will not be implemented. work before next year. And borrowers are still struggling to stay on top of their payments.

For borrowers like Laine, interest in a few years could negate any Biden relief she received.

“I was paying $300 until the pandemic hit. I was paying $300 a month, I think, for three to four years, and my balances never went down,” she said. “They were still going up.”

Officials like Laine can get their debts forgiven, but many can’t even get in touch with their loan officer

Although Laine is a big supporter of the cancellation of civil service loans, she said she “has been plagued by her own problems”.

The company that handles the entire civil service loan forgiveness portfolio – MOHELA – is not making it easy. After a number of loan companies terminated their federal contracts last year, all borrowers enrolled in the PSLF were transferred to MOHELA, and the process was not seamless.

Insider has already spoken with two borrowers who wanted simple questions answered about their PSLF payments, but ended up spending hours on the phone and never even being connected with a representative who could answer their questions.

“I’m really concerned about MOHELA as a total fixer,” Laine said.

Student loan borrowers rally to tell President Biden to cancel student debt

Student borrowers gather near the White House to demand debt forgiveness on May 12, 2020.

Paul Morigi/Getty Images for We The 45 Million



Although MOHELA has never commented on the hour-long wait times, Scott Buchanan, executive director of the Student Loan Servicing Alliance — a group that represents federal loan officers — previously told Insider that the Department of Education used to decide how many resources it gives to loan companies, which affects how many customer support employees they can hire.

But with the PSLF waiver expiring on Monday, which allows previous payments, including those previously deemed ineligible, to count toward forgiveness progress, borrowers are pressed for time to access the expanded relief. The department recently introduced permanent PSLF fixes after the waiver expires, but that doesn’t eliminate the confusion some borrowers may be having with their payment history.

“I would love nothing more than to be able to dedicate my entire career to serving this industry,” Laine said. “All of my career choices are sort of centered around that debt, and it’s a really tough and not fun place to be.”

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Student Loan/COVID Updates, SFV Duo Save Redwoods and MORE https://cec-ugc.org/student-loan-covid-updates-sfv-duo-save-redwoods-and-more/ Thu, 27 Oct 2022 22:50:36 +0000 https://cec-ugc.org/student-loan-covid-updates-sfv-duo-save-redwoods-and-more/ Hello neighbors. As we near the end of the first semester of this school year, many Californians and Americans are struggling to balance the exorbitant cost of their tuition with other expenses, and I understand how much your loan repayment timely can be stressful. That is why I am pleased to inform you that President […]]]>

Hello neighbors.

As we near the end of the first semester of this school year, many Californians and Americans are struggling to balance the exorbitant cost of their tuition with other expenses, and I understand how much your loan repayment timely can be stressful.

That is why I am pleased to inform you that President Biden announced the Federal Student Debt Relief Program in August, a one-time debt relief program that will cancel a portion of borrowers’ student debt. low- and middle-income earners with loan balances prior to June 30, 2022. Unfortunately, a temporary injunction has been issued while a legal matter is being considered, but the U.S. Department of Education encourages eligible applicants to apply to be ready as soon as the injunction issue is resolved.

Eligible borrowers can receive full or partial discharge of loans up to $20,000 if they are Federal Pell Grant recipients and up to $10,000 if they are not. Individuals are eligible if they earned less than $125,000 in 2021 or 2020, and families are eligible if they earned less than $250,000 in 2021 or 2020. Please keep in mind that if you filed federal taxes, your income requirements are based on your adjusted gross income. , which is found on line 11 of IRS Form 1040.

It should be mentioned that the California Legislature is aware that federal student debt relief may be considered taxable income for state purposes. However, the leaders of both houses of the Legislative Assembly issued a statement in September saying that if student debt relief is considered taxable in California, they will take immediate action in early 2023 to exempt it to ensure that no recipient of California relief will incur tax burden.

The portal is online and accessible HERE. For those unable to apply online, a paper version will soon be available. All applications must be submitted by December 31, 2023.

The cost of higher education should not leave families struggling to make ends meet. Programs like this can hopefully alleviate some of the stress many of you are facing and close some of the equity gaps that have become all too common.

For additional news you can use, scroll down to read more about the end of the COVID state emergency in California in February, how a couple from the San Fernando Valley fought climate change in saving two redwoods and MORE.

Now tell me what’s on your mind. Contact us via Facebook, Twitter, Instagram and my email, or call my office at (818) 901-5588.

Be well, stay safe and remember we are all in this together.


Bob Hertzberg


VALLEY NEWS

(PHOTO CREDIT: LA Times)

CALIFORNIA’S COVID-19 STATE OF EMERGENCY ENDS IN FEBRUARY

Because test positivity rates have plateaued for the past three months in California, Governor Newsom announced that the COVID-19 state of emergency will end on February 28, 2023. The state of emergency allowed Newsom to implement mask mandates, temporary stay-at-home orders and enter into no-tender emergency response contracts with testing facilities, equipment suppliers individual protection and temporary work agencies. The date of February 2023 was chosen to give the health system time to manage a possible increase in cases in winter. It also allows state and local partners to prepare for this elimination. After the emergency is over, California will continue to work to reduce the spread of COVID-19. To maintain the testing and therapeutic processing capacity of the state’s COVID-19 lab, Newsom plans to ensure that nurses will still be able to dispense COVID-19 therapeutics and that lab workers can process the tests. COVID-19. More here.

(PHOTO CREDIT: NBC Los Angeles)

EDD WARNS CALIFORNIANS OF SCAMS VIA SMS TO YOUR PHONE

California’s Department of Employment Development is warning residents of “smishing” scams in which criminals posing as EDD or Bank of America attempt to obtain sensitive information from people via text or phone. Typically, victims of this type of scam will receive an official-looking text message that includes a URL that leads victims to an apparently legitimate but fraudulent website. To check if a text really comes from the EDD, do not click on anything. Instead, check your account online or the notice sent by mail. The EDD has compiled the following tips for California residents:

  • Text messages asking users to reactivate a card by clicking on a link are scams; Bank of America and EDD never text people to reactivate a debit card.
  • Never click on a link in an unexpected text message claiming to be from EDD or Bank of America.
  • Call Bank of America using the phone number on the back of your debit card to verify if a bank-related text message is legitimate.
  • EDD sends SMS from the number 510-74 or 918-06; Please keep in mind, however, that a scammer could attempt to spoof this number.

If you believe you have been the target of such a scam, report it immediately to the National Center for Disaster Fraud by filing an NCDF Complaint Form or by calling 866-720-5721. You can also click HERE and select the “Report Fraud” category.

(PHOTO CREDIT: Sun of the San Fernando Valley)

SFV VOLUNTEERS RAISE $76,000 TO FIGHT ALZHEIMER’S DISEASE

At a local event to fight Alzheimer’s disease, more than 300 San Fernando Valley residents gathered at Los Angeles Pierce College in Woodland Hills to participate in the Alzheimer’s Association Walk to End Alzheimer’s Disease. Alzheimer’s disease, raising more than $76,000. It is estimated that 6 million Americans are living with Alzheimer’s disease and more than 11 million family members and friends provide care. Events like this walk help shed light on the challenges of living with Alzheimer’s disease and provide residents with an opportunity to give back to members of their community.

(PHOTO CREDIT: LA Times)

VOTING COUNTY COUNCIL TO PROVIDE LIBRARIES WITH NARCAN

The Los Angeles County Board of Supervisors has unanimously approved a proposal to provide county libraries with the anti-overdose drug naloxone (also known as Narcan) and train librarians in its administration. The action came after a recent spike in opioid deaths and fentanyl poisonings involving students in the Los Angeles Unified School District. Libraries will serve as distribution sites where residents can obtain doses of medication. The board also approved a motion that will require various county health and education agencies to provide school districts with the Narcan and develop an educational toolkit explaining the dangers of overdoses. Culturally and linguistically appropriate awareness and education are top priorities.

(PHOTO CREDIT: State of California Department of Public Health)

FENTANYL’S RECENT TOWN HALL IS NOW VISIBLE ONLINE

In addition to recent LA County efforts (see previous article), the LA County Department of Public Health hosted a virtual fentanyl town hall on October 12 that can be viewed for free online. Dr. Barbara Ferrer and other experts detail the dangers of the increased presence of fentanyl not only in drugs but also in counterfeit pills. The town hall describes what fentanyl is and what methods can be used to detect and prevent an overdose. Watch the Fentanyl Virtual Town Hall HERE:

(PHOTO CREDIT: LA County Animal Care and Control)

HOW TO HELP PREVENT STRAY CATS FROM BEING EUTHANASED

Although outdoor cats are often ignored and often do not evoke the same concern as stray dogs, they can cause quality of life issues for residents by spreading disease, falling victim to coyote predation and dogs and running in front of cars, among other mishaps. However, bringing cats to animal shelters is not the ideal solution, as the rescue rate for lost cats is extremely low and they are almost always humanely euthanized. The Los Angeles Department of Animal Care and Control has adopted nationally recognized best practices to recommend that healthy cats without owner identification be kept where they are. Many free-roaming cats have owners or are fed by a house or group of houses; they are part of their neighborhood and do not need the help of a care centre. The department offers a find and foster program for underage kittens found without a mother as well as the Good Neighbor Cat Spay and Neuter program. More here.

Shai Beaulet in the foreground next to Fern; Judith Filby-Beaulet is behind Shai, looking through the branches of Feather. (PHOTO COURTESY OF BEAULETS)

HISTORIC SEQUOOIS TREES SAVED BY SFV RESIDENTS

As climate change continues to become an increasingly pressing issue in California, the work of our local organizations and constituents is all the more helpful. Los Angeles residents Shai Beaulet and his wife, Judith Filby-Beaulet, hand-raised two young redwoods after they were uprooted from a living tree on a Studio City boardwalk directly under power lines. It is being cut down severely, and if not for the efforts of CalFire, Save the Redwoods, and other organizations, these trees would have died. One tree is 13 years old and is called Feather, and the other is 7 years old and is called Fern. Thanks to the Beaulets, two of California’s iconic redwoods will continue to thrive and serve as a reminder of the importance of environmental preservation. “Feather and Fern’s story shows that individual actions can still make a difference in slowing climate change and helping our environment,” said Shai Beaulet. Heart of the Valley. More here.

REMEMBER, WE ARE A TEAM

I appreciate hearing from you. If you have a specific question or concern, or a story to share about the valley, please click here to email me or call my office at (818) 901-5588. You can also join me on Facebook, Instagram and Twitter.

(Heart of the Valley is a free weekly email newsletter from Senator Bob Hertzberg. Subscribe HERE. Submission of articles for VALLEY NEWS, VALLEY ACTIVITIES or other suggestions are welcome and can be sent to ray.sotero@sen.ca.gov).

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